A SMALL YIELD.
The 60 per cent. dividend for fifteen months is equivalent to 48 per cent. per annum, so that, notwithstanding the big dividend, the yield on the present price of the shares is only about 1/ per cent. The Report itself, however, shows that the balance available, and which is added to the carry-forward, would permit a much larger dividend, while the Reserve stands at the high figure of £1,100,000. Even, however, if the whole earnings of the company were taken into considera- tion, and a yield of about 75 per cent. on the capital were allowed for, the position would still be discounted by the present price of the shares to an extent that the net yield would only be about 24 per cent., and, even if profit were doubled during the year, the yield would still be only about 5 per cent. Clearly, therefore, in these cases, the speculator is relying upon bonus shares as giving a quick appreciation in capital value. It must be remembered, however, that bonus shares with their doubling of the capital, in themselves still further discount future possibilities, and therefore, while securities of this description may offer excellent opportunities to the well-informed speculator, the position is quite different when viewed from the standpoint of the ordinary bona fide investor. It seems well to emphasize that point, because, as experience abundantly shows, the speculator usually relies upon being ultimately able to secure the capital appreciation by selling to those prepared to hold permanently. * *
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